The potential for artificial intelligence to transform underwriting workflows has caught up to the surety bonding industry. But it has also led to concerns about job security as a new survey by Lance Surety Bonds found 41% of surety professionals are worried about roles being replaced.

“It’s really a combination of concerns. There’s the obvious one of AI replacing jobs, but there’s also uncertainty around what happens when technology becomes the main decision maker,” Eric Weisbrot, digital marketing manager, Lance Surety Bonds, said.

He noted that alongside concern about job loss, many insurance professionals are “concerned about “overreliance on the technology and the lack of clear accountability if something goes wrong.”

In his view, the underlying issue is more about humans being removed from the loop and AI overshadowing human judgement.

“Once underwriting decisions start relying heavily on algorithms, questions about transparency and bias quickly follow. The real fear is not just job loss, but losing human judgment in the decision-making process. When real financial consequences are involved, that concern is understandable,” Weisbrot said.

However, the survey emphasized that AI itself is not the enemy. In fact, three out of five bonding professionals said they have already implemented automation in their bonding process and most said it can positively impact their roles.

As such, Weisbrot said balance between workflow modernization and workforce upskilling is key to navigating this new normal.

The case for modernization

Lance Surety Bonds’ survey confirmed what many industry leaders have already warned —- companies no longer have the luxury of avoiding AI in an era with increasing demand for technology-driven solutions.

“What’s important to keep in mind is that client demands are evolving faster than ever,” Weisbrot said. “Fifty-six percent of surety bond pros are saying it’s becoming more common for their clients to expect a digital-first experience. While that’s certainly an emerging trend in surety bonds, it’s really a trend happening across all types of insurance products.”

Surety bonding and risk management professionals surveyed also expressed confidence in AI’s capabilities, with 43% trusting it to be more accurate than traditional models, 58% saying they believe it can enhance underwriting roles and 66% saying going digital is key to staying competitive.

However, at the same time, one in five surety bonding professionals said their work is still manual — and most believe it’s causing their company to lose business. Fifty-nine percent of respondents said their firms are “losing money and speed because these more ‘old-school’ methods, like paper or fax, can be costly and time-consuming.”

Meanwhile, 70% of small owners surveyed said they would defect from their current surety bond provider “immediately” if they could get bonded in less than 10 minutes using AI instead.

“In an era where speed is crucial and businesses are having to do less with more, every second seems to count,” Weisbrot said.

Outpacing human skill

Concern about job loss is one of the potential downsides of AI being perceived as so effective, as indicated by the results of the study.

“If AI is already earning that trust and getting buy-in to outperform human judgment on assessing risk, one of the core skills of underwriters and advisors, then these roles built around human evaluation and processing are certainly feeling the pressure,” Weisbrot explained.

However, he believes the risk isn’t a simple matter of mass redundancy but a more nuanced concern about role transformation. While the term “skills gap” never appears in the research, he believes the results imply this could be a potential factor at play.

“The concerns around overreliance on algorithms and a lack of transparency in AI decisions signal that while some are adopting these tools, they still don’t fully understand them, which is a skills gap in itself,” Weisbrot said.

“Half of those we surveyed admitted they feel pressured to modernize, whether it’s due to competition from insurtech firms or internal bottlenecks. The pressure without capability is the perfect environment for a skills gap to take hold.”

Technological balance

The solution lies in integrating new technology while advancing AI literacy, according to Weisbrot, who emphasized that outdated workflows are costing companies who choose to do nothing.

“While leaders should invest in AI tools, you must invest in actual training as well; you can’t just integrate these new tools and expect your team to ‘figure it out.’ Build your staff and their confidence up by allowing them to upskill or train on these new technologies, and you should see an increased confidence in interpreting, auditing, and overriding AI decisions,” he said.

But individual professionals also have a role to play, he added, in learning to work with technology rather than fear it or see it as competition.

“Our research suggests pros best positioned for success are ones who can work alongside AI rather than go head-to-head with it. Combine speed and efficiency from these tools with your relationship management, ethical judgement and contextual knowledge that algorithms can’t replicate,” Weisbrot said.